Vanguard vs Robo-Advisors
I was a happy Vanguard user for years, then jumped Betterment a couple of years ago. Now, I’m having reservations. Other than Tax Loss Harvesting, I can’t see how Betterment is better. I can’t see how Wealthfront is any better either. Am I missing something? The main thing the Robo-Advisors seem to offer is simplicity in investing, but as far as I can tell, putting money in index funds is pretty darn easy.
Those are for cool kids who don’t know what investment is.
I’m starting to get that impression. Their target market is probably people who aren’t comfortable investing on their own. With that being said, investing in index funds with Vanguard is super easy.
Well. I’m not sure I agree completely. Betterment automates everything with fractional shares. I just set a dollar amount and it’ll figure out what to buy. Of course you can do that manually. You can also cook your own food.. doesn’t mean you always have to do that.
Vanguard FTW.
I'm in the same boat. I currently have my investments in Fidelity and Betterment but debating whether to move Betterment to Vanguard. Tax loss harvesting doesn't quite seem worth it.
Glad I’m not the only one 😀 I think some of the goal based investing with Betterment is kinda nice, but it can be easily done on your own with Vanguard.
You're not missing anything. Go back to Vanguard.
I moved all my Wealthfront stuff to Robinhood.
Does Vanguard have auto-rebalancing of the asset allocations? Or do I need to do that manually
They have a service that does auto rebalancing but for that Betterment is slightly cheaper.
Invest in their target retirement fund and they will allocate correctly between stocks and bonds. That said, rebalancing takes ten minutes a year. Why would you give away a large fraction of your income to save ten minutes?
I don't see any reason to pay 25basis points to these robo advisors, who mostly buy vanguard stocks for you. I keep minimal amount to see their portfolio and invest myself in Schwab and RH.
You are right that Betterment is mostly Vanguard funds. One of the things that I put in Betterment’s favor is that they aren’t locked into Vanguard to get better returns. In reality, I’m not sure if they are getting better returns though.
The other downside of robo advisors like Betterment is that transferring out to Vanguard is difficult and may force you to realize your gains (there are plenty of reviews of this process online).
I personally hate vanguard interface but find robo advisors too limiting so between vanguard and wealthfront I choose.. Schwab or IB.
Yeah vanguard's website is obtuse. I use it mostly because my 401k is already there otherwise I'd use an external broker too. But I'd still just buy Vanguard ETF'S.
I’m right there with you. The interface is fairly frustrating.
I agree , I am thinking about moving my investment from personal capital to vanguard as well
+1 for vanguard